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TWN Info Service on WTO and Trade Issues (Feb07/13)
21 February 2007
Third World Network
www.twnside.org.sg

Doha was never about development, says former USTR Barshefsky

The Doha Round was launched on false pretences, including calling it a development round, and the ability of developed countries to make it a development round is "absent", according to former United States Trade Representative, Charlene Barshefsky.

Barshefsky also remarked that the Round's conclusion would be hailed as a victory but the result would be "far less" than it should be if rich countries genuinely pursued a "development round."

These are perhaps the most frank comments made by a senior member of the trade establishment of the US on how the Doha talks were launched and how development was used as a "false pretence" to get developing countries on board.

They also seem to be in line with recent independent analyses of the main proposals on the table, that there is little pro-development content and would actually harm most developing countries.

Below is a report of the interview with Barshesky, which was published in the SUNS of 15 February.

With best wishes
Martin Khor
TWN

Doha was never about development, says former USTR Barshefsky

By Martin Khor (TWN), Penang, 14 Feb 2007

The Doha Round was launched on false pretences, including calling it a development round, and the ability of developed countries to make it a development round is "absent", according to former United States Trade Representative, Charlene Barshefsky.

In a recent interview, she also said that the Round would almost certainly not have been launched as there was no enthusiasm for it, but the September 11 incident changed that because countries had to show solidarity with the US.

Barshefsky also remarked that the Round's conclusion would be hailed as a victory but the result would be "far less" than it should be if rich countries genuinely pursued a "development round."

These are perhaps the most frank comments made by a senior member of the trade establishment of the US on how the Doha talks were launched and how development was used as a "false pretence" to get developing countries on board.

The remarks of the former USTR seem to be in line with recent independent analyses of the main proposals on the table, that there is little pro-development content. These include analyses by several academics (including Joseph Stiglitz of Columbia University, Robert Wade of the London School of Economics, Sandra Polaski of the Carnegie Endowment for International Peace, and Kevin Gallagher of Tufts University) and development groups (such as Oxfam, ActionAid and Third World Network).

Many of the analyses also show that in many ways the proposals on agriculture, non-agricultural market access and services, if accepted, would have negative effects on the development prospects of developing countries, as they would have to open their markets through very significant tariff reduction and the local farmers and industries would not be able to compete.

Barshefsky was USTR when the Uruguay Round agreement was signed and who represented the US at the first two WTO Ministerial conferences in 1996 and 1998. She is currently senior international partner at WilmerHale, a Washington law firm, and she is also a business leader, sitting on the boards of American Express, Estee Lauder, Intel and Starwood Hotels.

She was giving her views at a question-and-answer session in a "business blog" of the International Herald Tribune. The interview took place on 31 January at a blog site entitled "Managing Globalisation" run by Daniel Altman.

Barshefsky was asked whether there was hope for the WTO's Doha negotiations. She said that "given the reticence of most of the trade ministers in scoping out the odds of Doha being reinvigorated, and given the fact that several ministers have now become reasonably vocal with respect to movement, I suspect that the round will move forward fairly soon."

She was then asked if the conclusion of the round will live up to any of the original expectations.

Barshefsky replied: "The round was launched on essentially false pretenses, in two respects.

"First, it was launched almost immediately in the aftermath of 9/11. I believe that but for 9/11, it almost certainly would not have been launched. As the six-year delay since then shows, but for 9/11 there was almost no enthusiasm for the round.

"9/11 changed that. Countries believed that they needed to show solidarity with the United States and make a statement about the global economy and the importance of economic growth. So the round was launched.

"Second, the round was called a development round. Again, as the six-year delay shows, there may have been the broad "intention" on the part of the wealthy nations to make this a development round, but their ability to execute has always, in important respects, been absent - something clear from the outset, rhetoric aside.

"At the end of this process, what will undoubtedly be portrayed as an important victory will, I believe, be far less than what it should have been had the wealthy nations genuinely pursued a development round."

Barshefsky added that the US and Europe are "working hard", and that the developing countries are under enormous domestic political pressure not to make further large concessions, particularly in agriculture.

"It's understandable that everyone's domestic politics plays perhaps the most critical role in what ends up on the table in negotiations. But this really clashes with the notion the Doha Round is genuinely a development round."

Asked what she thought about the reported change in the negotiating strategy for Doha, with not so much stress on modalities, Barshefsky said, "It's the only place negotiators had left to go." Discussions of principles resulted in nothing concrete other than good wishes. Discussion of modalities in the abstract is fraught with delay and difficulty, and had been tried already, twice.

"The only place left to go is to say, All right, let's simply take a look at the specific issues on the table and resolve them, one way or another. That's where the negotiators have to turn, because there is no other means at this point to reinvigorate the round."

Barshefsky also said that if the Doha Round were not to conclude, "I don't believe there would be any short-term negative effect. Medium-term, I believe there could be more of an effect if countries believe that they have more manoeuvring room to protect domestic industries than they would have under a more robust international system of rules."

Asked about the role of bilateral and regional trade agreements, Barshefsky said their number, now in excess of 200 globally, will, with or without Doha, only increase.

Besides economic advantage, these agreements "speak to the building of political alliances. Free trade agreements are a means by which countries solidify their global position and global influence. You see this with every major player, except perhaps Japan, which hasn't engaged much in free trade agreement negotiations. You also see this in every region of the world as countries vie with one another not just in an economic sense, but in the projection of power."